Creditors of defunct Bitcoin exchange, Mt. Gox, can now have peace of mind as Gox Rising, an organization established to assist Mt Gox creditors in recovering their funds, has declared intent to purchase victims’ claims.
According to a press release today, Mt Gox’s creditors who do not wish to wait for the outcome of the legal process to retrieve their funds can be bought off.
A spokesperson of Gox Rising revealed that creditors who declare interest in the offer will be paid $800 per Bitcoin (BTC) as opposed to the current price of the most popular cryptocurrency. However, at the time of Mt Gox’s bankruptcy in February 2014, Bitcoin was trading around $575.
“Each claim will need to be individually reviewed, but we are looking to offer $800 per BTC claim. Gox Rising will pay that in Bitcoin or fiat currency of the Creditor’s choice,” the spokesperson said.
Notably, the firm would adopt an escrow service in making payments to creditors, and the entire process is scheduled to be concluded within ten business days.
The firm stated that it is considering other alternatives to bring “better liquidity” options to creditors while prompting claim holders to bring forward their suggestions irrespective of their claim size.
Mt Gox Bitcoin exchange hack
Mt. Gox Bitcoin exchange hack was one of the largest hacks ever to rock the cryptocurrency space. The hack and alleged mismanagement resulted in the loss of more than 850,000 BTC, which subsequently forced the firm to file for bankruptcy in 2014.
Since then, creditors of the exchange have been going back and forth, embarking on years-long litigation process to retrieve their funds.
During the litigation process, 200,000 BTC was found in an old wallet associated with the firm. However, the recovered funds could not be allocated to creditors at the time due to the continuous legal process.
In 2018, Coinfomania reported that a Tokyo district court moved the exchange from bankruptcy to civil rehabilitation. This gave creditors the right to receive their missing BTC rather than the cash equivalent of the asset at the time of the exchange’s collapse.
Wait two years or get $800/BTC?
The case does not seem to be ending anytime soon as major supporters of Mt Gox creditors, especially Andy Pag, the founder and coordinator of Mt. Gox Legal, had backed out of the process.
Pag claimed last year that Mt Gox might hold up the exchange’s civil rehabilitation process for up to two more years.
However, with Gox Rising’s proposal, creditors do not need to wait, as the organization notes that “we recognize that some investors may not wish to wait any longer to see what the final resolution and payout will be and how much longer that payout will be delayed.”